Car insurance premium increases in 2023

My home insurance is up while car insurance is also slightly up than last year. If you think of it, with everything going up (including minimum wages), companies have to raise prices to pay higher price of goods and in insurance industry, it's higher wages (I assume) which in turn means higher cost of doing business and stick the bill to us consumers :)
 
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FloridaJim57 said:
Just read an article on how much car insurance has gone up here in Florida.
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Tell me about it!

USAA has a third party verifying low mileage. They sent an estimate that mileage for my husband's car went from 2,000 annual miles to 4,400. I sent them proof (mileage on maintenance records over time) that the annual mileage is actually 1,970! $2000 a year for $2,000 miles. Completely crazy.
 
retired1 said:
My home insurance is up while car insurance is also slightly up than last year. If you think of it, with everything going up (including minimum wages), companies have to raise prices to pay higher price of goods and in insurance industry, it's higher wages (I assume) which in turn means higher cost of doing business and stick the bill to us consumers :)
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I help a friend do his books in a small Auto Body Shop now that I'm FIRED. Last year on January First paint went up 20% across the board.

Parts costs increase each month, plus many suppliers are adding a "fuel surcharge" per each delivery.

Plus, you can't find good help for at least 20% more than pre-pandemic.

That is only on the Physical Damage side of the premium. The lions share of auto insurance premium goes to pay for Medical Expenses whether it is Bodily Injury Liability, Medical Payments or Uninsured/Underinsured Motorist coverages. We all know how those expenses have increased.

Auto Insurance is very competitive and companies really do try hard to keep their costs down (try working with one to repair a car and you'll find out). There is plenty of competition out there, just watch TV for an hour. If you don't like your premium keep looking.

Your insurance company is constantly looking for new clients, you should be looking also.
 
You mentioned you were in the bay area. Would the increase in car break-ins be a factor for rates to increase in that area ?
 
My Geico rates jumped 59% in Phoenix: no change in insurance coverage, no reason
Contacted Arizona Department of Insurance - they did nothing

Here is my best guess for some the reasons:
1. car values are up , so claims are higher
2. more accidents due to distracted driving (cell phones)
3. ambulance chasing lawyers - higher risks of litigation with higher awards
 
I just bought a new higher dollar (68k) pickup and actually got a $150 refund from what I replaced on my policy
 
fishfactory said:
You mentioned you were in the bay area. Would the increase in car break-ins be a factor for rates to increase in that area ?
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Possibly. Lot of shopping malls have signs saying not to leave valuables in car.

But I think theft of catalytic converters are suppose to be a problem, though more in San Francisco and other big cities than in the suburbs.
 
We were surprised to see we actually went down $51 per year. Not huge, but better than up! This is LI, NY with Geico.
 
Mine went up, but I'm not shocked. I mean the price of an oil change skyrocketing shocked me more.

I have to believe they are paying out more and more for these cars to be fixed. There are so many more sensors and other things that can and do get damaged and each fix seems to be going up and up in price.
 
karen1972 said:
Mine went up, but I'm not shocked. I mean the price of an oil change skyrocketing shocked me more.

I have to believe they are paying out more and more for these cars to be fixed. There are so many more sensors and other things that can and do get damaged and each fix seems to be going up and up in price.
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I used to do all my oil changes but getting too old and it is difficult to get on the ground. When I checked to see if it would be possible to change the oil in our 2019 and 2020 Santa Fe I found it was considerably more difficult since I had to first remove a large cover that protects the underside of the engine on what in the past would have been to only remove a drain bolt and oil filter that were easily accessible.
I guess that getting access to work on the top of the engine has become more difficult and they are now focusing on the bottom access. Soon you will have to dismantle the entire front end of the car to do simple maintenance. :mad:

Cheers!
 
Buckeye said:
Tell me about it!

USAA has a third party verifying low mileage. They sent an estimate that mileage for my husband's car went from 2,000 annual miles to 4,400. I sent them proof (mileage on maintenance records over time) that the annual mileage is actually 1,970! $2000 a year for $2,000 miles. Completely crazy.
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Is it a high-end vehicle? I pay less than a third of that on a vehicle worth $20K. Unless you are driving something like a BMW where replacement parts are crazy expensive I would get a couple estimates from the competition.
 
karen1972 said:
Mine went up, but I'm not shocked. I mean the price of an oil change skyrocketing shocked me more.

I have to believe they are paying out more and more for these cars to be fixed. There are so many more sensors and other things that can and do get damaged and each fix seems to be going up and up in price.
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Even for an old crapbox car, the price to repair is going up. Labor is the killer.

Simple jobs like struts, brakes and alternator replacements are getting hit with high labor charges. It isn't gouging, it is the new market. Living wage and all...
 
Keep in mind that anything to do with cars has increased in cost even more than the roughly 9% inflation. So, not to take the side of the evil insurance companies, but something's got to give.
 
Make sure you use their app for monitoring driving behavior. The better you drive the more discount at next renewal.

I pay $93.94 a month with renters insurance. This is also a business policy so I get 65.5 cents per mile deduction.
 
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Koolau said:
Keep in mind that anything to do with cars has increased in cost even more than the roughly 9% inflation. So, not to take the side of the evil insurance companies, but something's got to give.
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Yes. Looking at CPI, auto maint and repair is up 13% year over year, and insurance is 16% year over year. Insurance is currently in "catch up" mode, seeing large rises in the last few months.

In my so-called "personal-cpi", automobile stuff is more significant than the collective 3.5% those two items factor into the overall CPI. So this hurts.

Anyone who has had any repairs done lately know the story. We can't all have new cars. If anything, this rise in repair is very regressive, hitting the people who can afford it the least hardest.

One last thing about this: insurers are declaring cars "total losses" more frequently these days. This is a long term trend, spanning over decades. It seemed to really get rolling when every car had a specific headlight assembly. Now, small collisions take out all kinds of sensors which are difficult to replace and expensive as repair parts. Set off an airbag? Then it is likely game over for the vehicle.
 
JoeWras said:
Yes. Looking at CPI, auto maint and repair is up 13% year over year, and insurance is 16% year over year. Insurance is currently in "catch up" mode, seeing large rises in the last few months.

In my so-called "personal-cpi", automobile stuff is more significant than the collective 3.5% those two items factor into the overall CPI. So this hurts.

Anyone who has had any repairs done lately know the story. We can't all have new cars. If anything, this rise in repair is very regressive, hitting the people who can afford it the least hardest.

One last thing about this: insurers are declaring cars "total losses" more frequently these days. This is a long term trend, spanning over decades. It seemed to really get rolling when every car had a specific headlight assembly. Now, small collisions take out all kinds of sensors which are difficult to replace and expensive as repair parts. Set off an airbag? Then it is likely game over for the vehicle.
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Sounds wasteful. If an insurer writes off a car as a total loss, is anyone allowed to salvage it for other parts at least or repair and use it or re-sell it?

Or sell other parts?

Or does the insurer take control of the car and sell it to some salvage operation to recoup some of their write-off?
 
explanade said:
Sounds wasteful. If an insurer writes off a car as a total loss, is anyone allowed to salvage it for other parts at least or repair and use it or re-sell it?

Or sell other parts?

Or does the insurer take control of the car and sell it to some salvage operation to recoup some of their write-off?
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I think each insurance company sets its own policies. IIRC a friend who's car was totaled by the insurance company was allowed to choose: Take the car (which was fully drivable) and give up 10% of the settlement or let the insurance company deal with the car and keep the whole settlement. He kept the car which looked fairly well trashed, but was still a "good" car.
 
From my 23 year career working in the actuarial field, specializing in car insurance, I can tell you, without revealing any trade secrets, some of what goes into car insurance rates.

We reviewed losses mainly for the most recent 1-3 years of data, depending on coverage. But we reviewed claim cost (losses per claim) and claim frequency (claims per car) over the longer term to see if were are more general trends. If more cars are being considered "totaled" instead of being repaired, that will appear as an increase in the claim cost, for example.

Higher medical costs will find there way into medical-based coverages such as Bodily Injury, No-Fault, Medical Payments, and Uninsured/Underinsured Motorists Bodily Injury.

Stronger mandatory insurance laws will put downward pressure on the Uninsured Motorists coverages. This happened a lot in the 1990s as computer technology helped to strengthen existing laws and motivate the passage of new laws.

This is just a sample of some of what goes into car insurance rates.
 
But if they're using data which goes back up to 3 years, remember that in 2020, there were a lot fewer miles drive, lot less cars on the road for a good part of that year.

You'd think that would result in lower costs.
 
F.I.R.E User said:
Make sure you use their app for monitoring driving behavior. The better you drive the more discount at next renewal.

I pay $93.94 a month with renters insurance. This is also a business policy so I get 65.5 cents per mile deduction.
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Not for me. They'd probably double my rates or drop me.
 
explanade said:
But if they're using data which goes back up to 3 years, remember that in 2020, there were a lot fewer miles drive, lot less cars on the road for a good part of that year.

You'd think that would result in lower costs.
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I don't know about the industry, but I did see lower rates on my own car in 2020 and 2021. They have increased back to their pre-pandemic levels.

Back in the 1991-92 recession, we saw losses trending downward before the recovery took hold in 1993.

The number of years we used in various parts of our review varied by coverage, and by the element we were reviewing. The number of claims determined the credibility of the loss data, so coverages with more claims used a greater weight on the latest year.
 
The BLS numbers are in at https://www.bls.gov/news.release/pdf/cpi.pdf

Car insurance:
- Up 17.1% year over year
- Up 2.0% month to month

2% rise from April to May! YIKES!!!!

I still think insurance is catching up to the increases in used car prices, which affects the "total loss" claims. It is also catching up to new car prices, although those have not been as dramatic.

Let's also not forget that price of repairs are up, which feeds into insurance. Those numbers from the BLS are as follows.

Motor Vehicle Maintenance and Repair:
- Up 13.5% year over year
- Up 0.6% month to month
 
scrabbler1 said:
I worked in the actuarial field for 23 years, specializing in personal auto insurance. Some states are like the ones you described ("prior approval"). But others did not require prior approval of rate changes. Those were called "file and use" states. I don't recall the exact breakdown between these two broad groups, but I can say that the states where car insurance was more expensive in general tended to be prior approval ones. Those states asked us the most questions and gave us the hardest time before they would grant approvals.

As for my own car, the rates dropped a lot during COVID. This was for liability coverages (which did not depend on aging of my car) and for physical damage coverages (Comprehensive and Collision) whose rates dropped also due to the car aging.

But with COVID behind us, at least as far as car insurance goes, the rates for my liability coverages have risen pretty sharply this year, back to pre-COVID levels, while physical damage coverages have risen slightly, as opposed to still dropping due to the car's aging. Physical Damage rates, for me, are only about 20% of the total premium.
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This gentleman won this argument. Shut it down,
 
Everyone here also seems to be forgetting that the most of your premum goes towards Bodily Injury Liability and now a large part to Med Pay and Uninsured and Underinsured Motorist coverage ? Basically medical bills....have they gone up lately ?
 
Also I guess a lot of ER members are carrying high levels of coverage, so that they can get a personal umbrella insurance as well.
 
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